Mobile banking no longer an alt-channel

Financial institutions must stop viewing mobile banking as an alternate channel and begin to view it as a vital service for millions of Americans, VSoft senior vice president Puneet Malhotra said.

A provider of banking and payment solutions to more than 2,600 financial institutions around the world, VSoft was founded in Atlanta in 1996 by people still running the company.

Mr. Malhotra said there are two groups of people who most heavily rely on their mobile devices for banking. The first is no surprise. Millennials may or may not have other devices and options for banking, but many strongly prefer using their mobiles for common financial transactions.

The second are the unbanked and underbanked. For many, the mobile is their only device for not only banking but all media consumption, as they may not have television or internet services.

“This is no longer an alternate channel,” Mr. Malhotra said.

Puneet Malhotra

Take society’s growing reliance on mobile devices and combine it with the needs/wants of these two groups and that gives ample reason why financial institutions need to have a core mobile transaction strategy, he added.

Luckily technologies like mobile deposit capture are improving to the point where most common devices can assist the banking experience. That is good news for institutions of all sizes and types.

Mr. Malhotra added the need to maximize mobile services should serve as a wakeup call for some financial institutions.

“Some treat the online channel completely different.”

Some institutions offer different pricing structures for online products, while others don’t have their full menu available in all environments, moves that alienate some customers and cause them to switch brands.

While harmonizing the experience across channels, financial institutions should also seize the opportunity to improve it, Mr. Malhotra suggested. Investigate technologies such as near field communication or artificial intelligence that allow customers to have a more effective experience.

Ask 10 experts what the branch of the future will look like and get prepared for 10 different answers, Mr. Malhotra suggested. He looks at Amazon and other successful online operations who are developing physical locations.

“Branches are here to stay,” he said. “Likely not $5 million branches but they’ll continue to be important for outreach. But their form will have to change.”

Allow for as much self-service as possible while training staff for those deeper conversations about lending options and portfolio management. Capitalize on mobile video capabilities that make check capture easier every day. Add bill pay and push capabilities, and by all means, leverage the volume of data that is coming your way at unprecedented levels.

A two-time LendIt Journalist of the Year nominee and winner in 2018, Tony has written more than 2,000 original articles on the blockchain, peer-to-peer lending, crowdfunding and emerging technologies over the past seven years, making him one of the senior writers in the alt-fi sector.

"The evolution of the crowdfunding and peer-to-peer lending scenes is absolutely fascinating to chronicle. It is a joy to be around people with such passion and vision."